Amazon revises cancellation fees, Flipkart adds penalties before festival season

Amazon and Flipkart have changed their seller fee and penalty structures ahead of the festive shopping season, with Amazon linking cancellation charges to order value and Flipkart introducing fixed penalties for seller-side failures.Amazon and Flipkart tighten cancellation rules before festive sales (Image credit: Reuters)Amazon and Flipkart are tightening their seller policies just as India's biggest shopping season approaches. Both e-commerce companies have introduced changes that could increase the cost of mistakes, cancellations and delayed shipments for sellers on their platforms.The changes come at an important time for online sellers. Festive sales typically bring a surge in orders, but they also put pressure on sellers to keep products available, dispatch orders on time and avoid cancellations. For businesses working with narrow margins, even relatively small additional charges can add up quickly.Amazon changes how seller cancellations are chargedAmazon has introduced a new cancellation-fee structure for sellers using its Easy Ship and Self-Ship services. Instead of calculating the charge using the earlier referral-fee-based system, the company will now determine the fee according to the value of the cancelled order.The revised charges took effect on August 17. According to a report from Money Control, sellers will pay 10 percent for orders below Rs 10,000. The rate falls to 8 percent for orders worth Rs 10,001 to Rs 50,000, 5 percent for orders between Rs 50,001 and Rs 1 lakh, and 2 percent for orders above Rs 1 lakh. The fee is applicable when the seller cancels an order for reasons unrelated to a customer's request. The fee can also apply when a seller misses the shipping deadline and does not confirm the dispatch within the following 24 hours, leading Amazon to cancel the order.That means the actual cost can be substantial on expensive products. A seller cancelling a Rs 5,000 order would face a Rs 500 charge under the new structure. For a Rs 20,000 order, the fee would be Rs 1,600. Sellers will also face higher closing charges from September 7. The increase is Re 1 for items priced at Rs 500 or less and Rs 3 for products costing more than Rs 500. The revised charges apply to Amazon's Fulfilment Centre, Easy Ship and Seller Flex services, as the company looks to offset rising fuel and logistics expenses.Flipkart introduces fixed penaltiesFlipkart has taken a different approach. The marketplace has introduced per-order penalties for sellers who have been on the platform for at least three months.A Rs 30 charge applies if a seller does not hand over an order to Flipkart's logistics partner by the agreed dispatch-by date. If a seller cancels an order after receiving it from a customer, the penalty rises to Rs 60. Missing the dispatch deadline and then cancelling the order can result in a Rs 90 charge. Flipkart is moving away from its earlier practice of restricting seller accounts over cancellations and is now using direct monetary penalties instead.The new charges arrive as e-commerce platforms compete for festive spending while also dealing with the growing popularity of quick-commerce services. Sellers are likely to see higher order volumes during the season, but the additional costs could make it harder for businesses operating on thin margins.“Fee hikes before the festive season are common, but for sellers operating on thin margins, the cumulative impact can be significant. Even small fees add up quickly on large order volumes and make the business harder to sustain,” a seller told Money Control.- EndsPublished By: Ankita GargPublished On: Aug 25, 2026 11:54 IST